§ 3.55 p.m.
§ THE PARLIAMENTARY SECRETARY, MINISTRY OF TRANSPORT (LORD CHESHAM)My Lords, I hope it may now be convenient for me to make a Statement, in the words of my right honourable friend the Minister of Transport in another place, about a British nuclear-powered merchant ship.
"For some time the Government have been considering ways and means of co-operating with shipbuilders and shipowners to get a nuclear-powered ship built on terms satisfactory both to the Government and to the two industries.
"As the House was told by the Parliamentary Secretary on April 28, for a long time both shipowners and shipbuilders were reluctant to spend money on building such a ship, and it appeared that if a nuclear-powered ship were to be built it would have to be a Government project. However, my honourable and gallant friend added that there was nothing to prevent a shipowner or a consortium from buying a reactor and giving it a trial; and that if this were to happen the Government would be delighted.
"I can now say that recently a shipbuilding company and a shipowning company have jointly approached my right honourable friend the Secretary of State for Education and Science and myself, with the object of building and operating a large merchant vessel powered by a Vulcain-type reactor. The firms concerned are Furness Shipbuilding Company and Anglo Norness Shipping Company. I may add that Imperial Chemical Industries are considering the possibility of employing the vessel if suitable terms can be negotiated. Discussions are in progress to see whether agreement can be reached on arrangements for the financing and organisation of such a project."
My Lords, that is the statement.
EARL ALEXANDER OF HILLS-BOROUGHMy Lords, some parts of that Statement are welcome: that something is apparently being done and discussions are going on, in spite of the report that came to us from the Atomic Energy Commission that there was no reactor in sight which could bring about economically the propulsion of merchant ships by nuclear power. To-day we get this sudden position arising, where the Government make this announcement; but the Minister does not tell us that they have also had three firm offers from other sources—from the Babcock Company, from the General Electric Company of America and from Mitchells in this country. All three were for propositions which included these things. I know what I am talking about; I am quite sure the noble Lord knows I have kept carefully in touch with these matters, both with this matter and with the reactor being developed for the Royal Navy elsewhere. I have kept in touch. And here is the extraordinary position that this is put to us in this way.
I think the noble Lord said the reactor would be of the Vulcain type, the one which at present is being developed by the Belgian company, under heavy subsidy from the Government. That is so is it not? A total of £5 million this year or in the next year or so will be spent, additional to what has already been spent on it. Can the noble Lord tell me what is to be the cost of the reactor of the Vulcain type which is to be put into this ship whose planning is now being discussed by a British shipbuilding company and a joint Anglo-Norwegian company? What is to be the cost of the reactor? Will he tell us that? Secondly, is it not bound to be very much in excess of the cost of other reactors that have been offered? The other firm bids I have referred to are in connection not merely with the reactor companies but with the shipbuilding companies. They have had no further discussions of the submission made, as far as I can understand it; and, of course, they have been noting with great interest the fact that Sir Thomas Padmore's Report said there was not an economic reactor in sight.
I think that we must have a good deal more information from the noble Lord. I would not press him to this extent if it were not that this is the last full opera- 1234 tional day for months ahead, and Parliament ought to know what is going on. May I ask whether the discussions now going on will include discussions with a view to payment of a subsidy with regard to shipbuilding or with regard to the supply of a reactor? Perhaps that is good enough to be going on with.
§ LORD HOBSONMy Lords, will the noble Lord inform the House whether any consideration has been given by Her Majesty's Government to the building of a Fleet auxiliary which could be powered by a nuclear reactor? Secondly, I should like to ask what further financial commitment Her Majesty's Government will have made by using this Vulcain reactor.
§ LORD CHESHAMMy Lords, I must confess that I was a little puzzled by the three firm propositions that the noble Earl who leads the Opposition mentioned. I take it that they are reactor projects and not firm propositions for building a nuclear-powered ship. If he meant the former, there may have been. If he meant propositions to build a ship, no other firm proposition has yet been put before my right honourable friend.
EARL ALEXANDER OF HILLS-BOROUGHMy Lords, I can cite one straight away—that is the case of a firm who have in hand a 24,000-ton tanker, on which they made a firm proposition and asked for the help of the Government in financing it. There has been no real co-operation in that respect. They have the tanker in hand and want to put in a reactor, one of the three I mentioned, and they have got nowhere with the negotiations.
§ LORD CHESHAMMy Lords, possibly not. As I say, I was unaware of that proposition, which was the reason I said what I did. It may well be that it was not of a firmness comparable to that of the proposition which I have announced to-day which we thought the proper thing to do. The noble Earl asked me what would be the cost of the reactor. I am afraid that to-day I cannot tell him the cost of this particular reactor. But the two firms concerned in this consortium (if two can be a consortium) are hardly likely to select the most expensive way of doing this. I can hardly believe that in their commercial judgment they are likely to do that.
§ LORD CHESHAMThe noble Earl said "Well!", but people are really not quite so stupid as would be indicated by the noble Earl saying "Well!" at this stage. I simply do not accept it for a moment. The noble Earl asked whether there would be a subsidy or not. I said deliberately at the end of my statement that
discussions are in progress to see whether an agreement can be reached on arrangements for the financing and organisation of such a project.The question of a subsidy and the Government's part in the project will have to be discussed.The noble Earl said that much more information must be given to the House. I am willing to give all that I can in the circumstances. I ought to tell him that my right honourable friend was discussing certain details with the chairmen of the companies concerned last evening, and I am trying to give the House all the information I can for the very reason the noble Earl mentioned: that this is the last day on which I can do so. Pending the outcome of these detailed discussions, I cannot go into greated detail.
The question of a Fleet auxiliary raised by the noble Lord, Lord Hobson, is not involved in this issue, because the Navy have their specialised requirement for reactors. Reactors for merchant shipping use are a different proposition altogether. The noble Lord shakes his head, but this has been proved in the case of the Russian ice-breaker "Lenin", whose reactor is hopelessly and totally uneconomic but is operationally acceptable because of the work it does. It does not have to pay. A merchant ship is another matter, and the two are not strictly comparable. I think I have dealt with the other point which the noble Lord raised. I will willingly answer any further questions I can, but I think the House will realise that I am necessarily limited in what I can say at the present time, in view of the progress of the proposition.
§ LORD HOBSONMy Lords, could the noble Lord inform the House why there is a different Government policy with 1236 regard to nuclear-powered ships than with regard to nuclear power stations, where, under the Government's very sensible plan, different types of reactors are to be given trials? Why, in this particular case, have the Government plumped for an unproven reactor in the form of the Vulcain?
§ LORD CHESHAMMy Lords, when the noble Lord comes to read my statement again in the morning he will see that the Government have not "plumped for it". The proposition has come from the two firms concerned. I do not see that there is any inconsistency in policy in this case in any way. This is a commercial proposition by two firms who have come to the Government with it. It cannot be compared with a matter of Government policy in a nationalised industry.
EARL ALEXANDER OF HILLS-BOROUGHMy Lords, is it not reasonable that members of the Opposition should ask searching questions on this matter? Because we have had some disappointing results in financial controls on other Government projects. In this case, would it be true to say that the Vulcain-type reactor will cost at least £2 million? Would it not also be true to say that the Government have given no real consideration to other reactors, like the Mitchell reactor, in which case the company gave a firm offer of completion and insertion under guarantee at £550,000? For some reason or another, neither the Atomic Energy Authority nor the Government have paid any real attention or had any examination made of this project. We just do not understand where the Government are going.
§ LORD CHESHAMMy Lords, I know it is the policy of the Opposition to try to place private enterprise in the worst possible light in every conceivable case, but if we are being asked to accept that any firm of commercial sanity is going to buy a £2 million reactor when they could get an adequate one for half a million pounds, that is stretching our credulity too far.
EARL ALEXANDER OF HILLS-BOROUGHMy Lords, it is strange, if this has gone so far in joint consideration, that we have heard nothing at all of the other proposals which have 1237 been made to the Ministry, to my knowledge. One of them was the firm offer of a Mitchell.
§ LORD HOBSONMy Lords, is the noble Lord aware that we are complaining about the fact that the Government are choosing a quasi-nationalised atomic reactor rather than asking for competition from other manufacturers?
§ LORD CHESHAMMy Lords, I think I will get this point over to the noble Lord, even if it kills me. The Government have not chosen this type of reactor. The Government have not even adopted the proposition put forward by two firms in the industry. I am merely telling the House that this proposition has been put forward by these two firms and it is being seriously considered with them by the Government.
LORD REABut can the noble Lord say that the way is still open for other firms to put forward proposals?
§ LORD CHESHAMCertainly, my Lords, if any other firm proposition comes from any other company or consortium, my right honourable friend will give it the same serious consideration as he is giving to this one.
§ LORD SHERFIELDMy Lords, having had some slight previous experience of these matters, I should like to say how glad I am that this opportunity is being taken by the Government to proceed with the construction of a nuclear ship. I think it is a very good thing that this consortium has selected the Vulcain reactor for its power unit, because that is the reactor of which our scientists and engineers have the greatest experience, and it is the reactor which, if my memory serves me, was recommended by the Committee which recently went into the various types of reactor.
EARL ALEXANDER OF HILLS-BOROUGHMy Lords, that statement proves what I say: that the Atomic Energy Authority, with all their failures in these matters in the past, are very 1238 glad that this is being done along the line of the reactor they are still getting Government subsidies to continue in a Belgian firm. I am astonished that the noble Lord should have interrupted in this way, having just come out of the Atomic Energy Authority.
§ LORD CHESHAMMy Lords, I was interested to hear the noble Earl say that what fell from the noble Lord, Lord Sherfield, proved what he said. I thought it proved the opposite.
EARL ALEXANDER OF HILLS-BOROUGHMy Lords, I do not think so. You had your Report as a result of the Atomic Energy Authority's proceedings. You have had the Padmore Committee's Report, and the expression of opinion there was that no reactor was in sight which could give an economic result for merchant ship propulsion.
§ LORD CHESHAMMy Lords, if that is so, it is strange—and I have had a little experience myself as a former chairman of a marine nuclear-propulsion committee—that the Padmore Committee also recommended that the next best thing to do was to build a ship.
THE EARL OF SELKIRKMy Lords, may I ask my noble friend if he realises that there are a great many people who are delighted to hear that some progress is being made in this very complicated subject, which is perhaps not the easiest to discuss over the Table here? May I ask, now that the safety arrangements seem to be advanced a lot further—the "Savannah" has recently docked in the middle of Southampton—whether the Government can endorse the statement of the Padmore Committee, that it is probable that a marine nuclear reactor for nuclear ships will be developed, and even if this ship is not itself developed, that the Government have real hopes that an economic ship will come shortly, if not immediately thereafter?
§ LORD CHESHAMYes, my Lords, that is true. And we have every hope that, subject to suitable safeguards, it will be adequately safe